UK agencies blast Keurig Dr Pepper’s 360 day PR payment terms

Client payment terms are always good for a laugh – usually of the hollow variety – but global consumer products outfit Keurig Dr Pepper has taken the biscuit with its current demand that PR agencies pitching for its US account accept payment terms of 360 days – which, if memory serves, is five days short of a full year.

Those that find this a bit of a stretch are being offered financing, at their own cost, through Atlanta-based Prime Revenue.

The UK’s IPA, which represents ad agencies, has weighed in on behalf of its PR cousins. IPA director general Paul Bainsfair (not usually noted for slamming clients) says: “When I first heard this story, I thought it was fake news. But sadly it is not which just demonstrates to me, and to others leading UK agencies, that the brazen way in which Keurig Dr Pepper has requested such payment terms shows how out of touch their corporate culture has become. Their supply chain “commitment to high standards of..ethical conduct” seems in need of an update. It is an example of virtual signalling at its very best.

“It is important to be clear what acceptable supplier payment terms are. For ad agencies in the UK, the standard position is thirty days. Anything above that should be questioned. Agencies are the business partners of their clients. They should not be expected, or even asked, to accept unreasonable payment terms. They have their own businesses to run.

“Good clients,” he warns, “attract good agencies.”

Client shenanigans continually surprise but this is certainly a winner. How does a client expect good performance and service if they won’t pay for it (for 360 days)? Agencies of all stripes have not always been pillars of rectitude in the past. But who can blame them?

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.